The budget-savvy way to choose a cell phone contract

In today’s work and business environment, a cell phone contract is a necessity for most people. Although the monthly fee might not seem like that much, it is a long-term commitment that can take its toll on your budget.

Before you get a new contract or upgrade your existing one, you need to make sure that your decision will make economic sense in the long run.

Here are 6 things you should consider before taking out a new contract:

1. Make sure you know what you need

Most people think about the device they want first, and then try and find a deal for that specific device. If you have the luxury of paying more because you want a specific brand, that’s great. Budget conscious consumers, however, should never start with the device first.

Make sure you know exactly how many minutes (talk time), data and SMSs or airtime you need in a month.
If you already have a cell phone contract, you should have a good idea of what you are spending already. Ideally your contract should provide you with enough minutes and data or airtime to last you the entire month. Generally, you pay more per second and more per MB data when you have to recharge with additional bundles or airtime.

Once you know how much data, minutes or airtime you need, you can look for cell phone contracts that meet your needs

2. Pick your device smartly

When you know the requirements for the contract that you need, you can start shopping around for the most affordable deals.

When it comes to the device, don’t be fooled by what is popular. The big brands out there offer great quality phones, and if you do decide to go for an expensive flagship smartphone, it should be because you really need the features that it offers. Do not pay more for specs that you will never use or don’t even understand. Even popular brands like Samsung offer more affordable (just as good) phones.

There are a number of lesser known or less popular brands that offer phones that will suit most people’s needs at a fraction of the cost. For example, the affordable series of Vodacom-branded devices (like the Vodacom Kicka) and the Verssed cell phones. CAT also offers relatively affordable devices that are perfect if you work outdoors.

3. Timing is everything

If you do want the latest phone, you can save money by buying at the right time. Before buying the phone you want, use Google to find out when the next model is rumoured to be released. If the rumoured release date is only a few months away, try and wait for the new model to be released as this will probably cause a decrease in the price of the current model.

Since South Africa mostly imports technological devices, the exchange rate does affect pricing. During times of a struggling rand, phones will also be more expensive.

4. Shop around for deals

In South Africa you really have a wide range of telecoms businesses that you can choose from, and you owe it to your budget to let go of your loyalty towards one specific brand or network.

While Vodacom, MTN, Cell C and Telkom are the only networks available, there are hundreds of different dealers in the country. Make sure you have a look at what all 4 networks have to offer – as long as you have coverage in your area.

Independent dealers like Chatz, Game, Smartcom and Edgars often have exclusive deals on certain contracts offered by the networks. To increase their base, dealers (especially on the Vodacom network) would often pay a portion of the device so that they can offer the contract at a cheaper monthly cost to their customers.

5. Consider a SIM only contract

All the networks offer options where you can take a monthly contract for your data and voice needs without a device.

The monthly fee you pay for your cell phone contract consist of two parts: the first is the subscription fee for the data, minutes, airtime and SMSs that you get every month, while the second part is for the device. Before taking out a contract, ask what the SIM only cost for the specific contract is. Anything more than the SIM only monthly cost is the portion that you are paying for the device.

If your phone is still working when you are due for an upgrade, you can take a deal without a device, or take a cheap phone that will not affect your monthly subscription cost.

Also consider saving for a couple of months and then buying a new affordable phone in cash. Dealers like Smartcom and PEP cellular also have the option to buy phones on lay-by.

6. Beware of the extras

On top of your monthly subscription fee, there might be a variety of other fees that you are being charged for. Make sure you know what these chargers are and whether or not you need it.

• Some networks will still charge you for Caller Identity, the functionality to see who is calling you.
• If you changed from a BlackBerry to another brand, make sure to cancel BIS on your contract.
• If you have insurance, it is your responsibility to inform the insurance company when your device changes.
• If you want monthly itemised billing, it will have an additional charge.

Have some tips of your own? Tell us about your experiences in the comment section below.

About The Author

Enrique is the eternal entrepreneur: his first venture was selling off his parents’ household goods at bargain prices to their neighbours at age seven. All other endeavours thus far have been entirely above board.

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